A&O divests major stake, LexSoft announces KM platform, and Clio report
Progress continues in legal technology with significant appointments, software advancements, M&A strategies, and a focus on AI solutions, evidencing the growing influence of data analysis, cloud-based services, and artificial intelligence in the industry.
Welcome to your Law Tech briefing for Nov 1, covering what happened in legal tech recently.
TLDR; Listen instead:
Have less than a 1 min? Three takeaways from yesterday
- Law firms should focus on integrating technological advancements into their operation, such as client relationship management systems, data analysis, and AI-powered legal tools. These technological innovations not only improve efficiency but also recalibrate strategies in legal practice. It's important to note, however, that while AI tools can assist in legal decisions, overreliance should be avoided to maintain balance and responsibility.
- As Software-as-a-Service (SaaS) becomes more dominant in the legal sector, firms are encouraged to utilise cloud-based knowledge management solutions, like the one provided by Lexsoft Systems. These platforms can alleviate upfront IT costs and technical complexity, making technological adaptation more manageable and cost-efficient.
- In the light of growing interest in financial analysis, as exemplified by the new financial health metric 'Lockup' in the 2023 Clio Legal Trends Report, firms should consider transitioning to electronic billing, automating processes, and exploring alternative billing arrangements. These changes could significantly improve efficiency and profitability by reshaping traditional practices.
Briefing
Here's what happened in legal tech recently...
Allison Nussbaum joined Australian firm Client Sense as VP of Client Solutions, bringing her expertise in data analysis and client relationship management from renowned companies. In the software realm, Lexsoft Systems released a cloud-based version of its Lexsoft T3 knowledge management (KM) solution, which alleviates upfront IT costs and technical complexity. Meanwhile, Allen & Overy divested a majority share of aosphere to Inflexion and Endicott Capital, allowing aosphere to operate independently. Furthermore, LexisNexis Legal & Professional introduced Lexis+ AI, an innovative generative AI tool for US customers.
Trends
The trend of transitioning from traditional to AI-driven legal services continues manifesting. The inclusion of Allison Nussbaum in Client Sense signifies the growing role of client relationship management and data analysis in legal practice. The cloud-based novel version of the KM solution by Lexsoft Systems reinforces the influence of Software-as-a-Service in the legal sector. The divestment of aosphere heralds M&A activities as a strategy to foster independent operation and global expansion. Additionally, the introduction of Lexis+ AI highlights how generative AI plays a part in transforming legal tasks.
Analysis
As these developments highlight, the legal tech industry is undergoing revolutionary changes. Data analysis, cloud-based solutions, independent operation, and AI are all playing larger roles in this transition. While AI tools, like Lexis+ AI, could potentially substitute human judgment in legal decisions, it's crucial to maintain a balanced and responsible approach, avoiding overreliance on such technology for critical legal decisions. User education and frequent bias testing were recommended as strategies for responsible AI usage. Lastly, the introduction of 'Lockup', a new financial health metric, in the 2023 Clio Legal Trends Report signifies an increased interest in financial analysis. Firms are urged to transition to electronic billing, automate processes, and consider alternative billing arrangements, reshaping legacy practices in pursuit of better efficiency and profitability.
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Key stories
Allen & Overy divests majority stake in aosphere to two PE fund partners (Legal IT Insider)
Allen & Overy (A&O) has offloaded a majority stake in its legal and compliance subscription business aosphere to private equity firms Inflexion and Endicott Capital. Aosphrere will now operate as an independent entity but will continue to offer its 725 blue-chip clients, including banks and asset managers, online legal analysis across a multitude of compliance areas such as data privacy, cross-border marketing, and financial derivatives. The new partnership aims to expand aosphere’s global footprint and particularly increase its business in the US. CEO Marc-Henri Chamay heralded the deal as a major opportunity to boost growth and provide even more comprehensive and valuable information to clients.
All stories
Client Sense hires Allison Nussbaum as VP of client solutions (Legal IT Insider)
Australian client relationship management firm, Client Sense, has named Allison Nussbaum as VP of client solutions. Nussbaum brings her experience from Pitchly, Kira Systems, Manzama, Nixon Peabody, and Goodwin Procter to help shape Client Sense's strategic partnership with Litera. Her expertise in data analysis and client relationship management will be instrumental in the company's expansion in the US, which includes firms like Lathrop GPM, Roetzel, Bilzin Sumberg, Smith Anderson, and Allen Matkins.
Lexsoft Systems has released a cloud-based version of its knowledge management (KM) solution, Lexsoft T3, eliminating upfront IT costs and technical complexity. The software-as-a-service solution is implemented over iManage Work in the Microsoft Azure environment. This integration with iManage Insight+ enables firms to move their KM capability to the cloud, making resources accessible from any device or location.
Lexsoft Systems has introduced a cloud-based version of its knowledge management (KM) solution, Lexsoft T3. This software-as-a-service solution, compatible with iManage Work and iManage Insight+, removes initial IT costs and technical complexity. It enables law firms to set up a global KM capability and shift their KM to the cloud, allowing access to knowledge resources anywhere. Lexsoft's T3 also ensures the security of organisations' knowledge within their own environment.
LexisNexis Legal & Professional has introduced Lexis+ AI, a generative AI tool for US customers, developed in collaboration with global law firms, courts, Amazon Web Services, and OpenAI. The tool offers faster legal results, conversational search, legal drafting, summarization, and document upload features, all secured with advanced encryption and privacy technology. It also validates all citations against Shepard’s, reducing the chance of fabricated content.
According to Dawid Kotur and Nick Long from Curvestone, Generative AI tools, such as large language models like ChatGPT, could transform the legal industry by aiding in tasks such as summarizing texts and extracting contract specifics. They could also potentially replicate human judgment in legal decisions. However, they warn against over-dependence on AI for crucial legal decisions and emphasize the importance of bias testing and user education for responsible use.
The 2023 Legal Trends Report by Clio indicates an increase in law firm productivity and tech adoption since 2016. A new financial health metric, 'Lockup', was introduced in this year's report. Joshua Lenon, a lawyer at Clio, provided additional insights during a live interview at the Clio Cloud Conference.
When It Comes to Legal Innovation Everything is Connected (Artificial Lawyer)
Legal tech is not a stand-alone entity, but rather a part of the broader legal innovation ecosystem. The goal of legal tech is to make the delivery of legal services cheaper, faster, more efficient, and less risky, while also increasing knowledge. The use of legal tech is interconnected with various factors such as billing models, division of legal labor, technology used, communication, cost, relationships, feedback, and long-term effects.
Lockup: A New Metric to Monitor Law Firm Cash Flow (Attorney at Work)
The 2023 Clio Legal Trends Report introduces Lockup, a new metric to monitor law firm cash flow by measuring the speed at which businesses receive payment post-invoicing. The report advises law firms to enhance their cash flow by tracking key performance metrics, improving invoice communication, transitioning to electronic billing, accepting online payments, refining operating procedures, automating processes, and considering alternative billing arrangements.
